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Trust distributions – part 1: structural and administration considerations


A trust is often used for business and investment vehicles because the beneficiaries are taxed on distributions of trust income, unless accumulated by the trustee. The form of the trust, the terms of the trust instrument, the drafting of distribution resolutions, legislative restrictions and Australian Taxation Office administrative practices may alter the intended distribution effect with unanticipated tax consequences. This two-part article will discuss these issues affecting trust distributions and provide example resolutions and possible distribution methodologies to manage these issues. Part 2 of the article will consider how these issues
affect selected common and complex trust distribution transactions.

Author profile

Ronald Jorgensen CTA
Ron principally consults on Commonwealth and State tax laws, tax dispute resolution and compliance enforcement. Ron specialises in trusts and trust disputes, succession and asset protection, business and investment structuring and tax sensitive commercial and property transactions. Ron is an Accredited Specialist Tax Law and member of the Tax Law Advisory Committee with the Law Institute of Victoria. He is a member of the Property and Commercial Law Committee of the Law Society of Tasmania. Ron is a Chartered Tax Advisor and member and former chair of the States Taxes Committee (Vic) of The Tax Institute. Ron was recognised by Doyle’s Guide Leading Tax Lawyer - Victoria for 2015 to 2021 and Best Lawyers for tax law - Australia 2021 and Global 2021. - Current at 16 July 2021
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